Agency problem

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Agency problem

Conflicts of interest among stockholders, bondholders, and managers.

Agency Problem

A situation in which agents of an organization (e.g. the management) use their authority for their own benefit rather than that of the principals (e.g. the shareholders). The agency problem also refers to simple disagreement between agents and principals. For example, a publicly-traded company's board of directors may disagree with shareholders on how to best invest the company's assets. It especially applies when the board wishes to invest in securities that would favor board members' outside interests.
References in periodicals archive ?
Foreign aid suffers from a principal-agent problem, in which organizations prioritize donors' political and commercial interests over recipients' needs.
Spatial models miss the mark by failing to recognize that the confirmation process is both a political negotiation and a principal-agent problem.
This principal-agent problem applies elsewhere in energy, too.
If you think that the power of the servant is not a form of power at all, then maybe you should spend a little time talking to someone who studies administrative law or, indeed, anyone who has written on the principal-agent problem.
The principal-agent problem that bedevils even democratic governments is particularly pronounced in authoritarian regimes, such as Iran's, which are not accountable to an electorate.
33) Second, there is a deeper principal-agent problem, as
Tuan-Hwee Sng, Northwestern University, "Size and Dynastic Decline: The Principal-Agent Problem in Late Imperial China 1700-1850"
The economics-and-law literature on the principal-agent problem of public corporations is extensive.
This article addresses the principal-agent problem that was already existent in China's state-owned media but became much worse after China's media reform in 1978.
There is a principal-agent problem in the three-way relationship, because the sports agent is negotiating on the behalf of the athlete.

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